By Fulfilling Its Commitment to SC, Trai Can Bring Down Mobile Call Rates by Half

Trai is pretty close to slashing interconnect usage charge (IUC) from the current 14 paise per minute to below 10 paise, a move that is long overdue.

Picture for representation.

The Telecom Regulatory Authority of India (Trai) is about to make a critical intervention in the cost of mobile call charges. According to a story in the Times of India, Trai is pretty close to slashing interconnect usage charge (IUC) from the current 14 paise per minute to below 10 paise.

This is a welcome move, writes Sindhu Bhattacharya for Firstpost, one that has been long overdue, because Trai will demonstrate that though it is mandated to steer the telecom marketplace in a manner that ensures the health of the operators, its primary commitment is to a much larger cause: Consumer interest.

IUC is the charge telecom operators pay each other to enable voice calls across all networks. As an example, let's take the case of an Airtel user calling an Idea user. Here, Airtel is using the network facilities of Idea to make the call happen, so it will have to pay some costs (IUC) to Idea.

The quantum of IUC is determined by Trai, currently it is 14 paise per minute. That is, the Airtel user pays 30 paise per minute to Airtel for the call. Airtel passes on 14 paise out of this to Idea. The reverse is true when an Idea user calls an Airtel user, then Idea will pay IUC to Airtel.

The stark fact that's hidden in the voice call charges you pay your operator is this: You pay 30 paise per voice call minute to your operator. Your operator pays 14 paise, or 45 percent, to the operator on whose network your call terminates. That is, almost half of your call charge is IUC, the charge that mobile operators pay each other (from your pocket, that is). What this means is that your call charges can drop to half if IUC is zero.